M & M In Talks With Renault For Sourcing Engines
The company, in another significant decision, has phased out Armada Grand model coinciding with the launch of Bolero. At the time of phasing, the company was selling around 250 vehicles of the model per month.
Executive director and president, automotive sector, Alan E Durante said that there was a possibility of Bolero, which was launched recently, eating into the market of the Armada. "We expect it to last for another 18 months. At present, around 150 vehicles are sold per month," he said.
He said a decision on selecting partner for sourcing the engine will be taken within six weeks. He, however, ruled any stake for the partner. Earlier, Peugeot had got a 10 per cent stake in one of the ventures of M&M.
Durante said the company will be exporting petrol versions of Bolero to Dubai and Muscat. He said Isuzu engines, developed in partnership with Hindustan Motors, are being used for the petrol version.
The new engines will be Euro III compliant. "We want to source only those engines which comply with the highest emission standards and are fuel efficient," Durante said.
Around Rs 400-500 crore is being invested into Project Scorpio, under which a series of MUVs will be launched, and the first vehicle from the stable will be launched by June next year. "The present day mantra is outsourcing and, hence, one cannot really say how much investments are we planning to pump into other projects during the next three years," he said.
Durante also said M&M will be relaunching Voyager in Karnataka by pricing it competitively. The company had to stop selling these vehicles because of the peculiar road tax structure of the Karnataka government, he said.
The Bolero GLX vehicle, which was launched in Bangalore yesterday, is the cheapest available model in the utility vehicle segment. Priced, ex-showroom, at Rs 4,88,569.47, the diesel version comes with addon features like AC, power steering, power windows, Kenwood audio system and central locking. A version fitted with a with global positioning system will also be launched soon.
"It is targeted at the urban and semi-urban market," vice-president, marketing, Rajesh Jejurikar said. Till now 75 per cent of M&M's revenues comes from the rural market. "Hence we are trying to break free and have launched a vehicle for the urban sector," he said.
Bolero, name of Spanish dance and the company pumped in around Rs 40 crore into the project.
Durante said that for the first six months, the company will offer the same price. He expected Bolero to have a 25 per cent market share in utility vehicle segment in which M&M has around 5 per cent - 6 per
cent stake at present.
The eight-seater vehicle carries an excise duty of 38 per cent and a sales tax of 12 per cent. At present, the company is geared up to manufacture around 900 units per month but it would take at least two months to deliver the first vehicle.
Durante said with the entry of Toyota-Kirloskar's Qualis had in fact registered a growth of around 9 per cent. "Without the entry of Qualis, the UV market would have shown a dip of around 12 per cent.